With the FCC about to propose changes in its national ownership cap for television at its meeting tomorrow (see our article here), we thought that we would take a look back to the week before Thanksgiving, when the FCC made some important decisions for the broadcast industry – including the approval of the Next Generation TV transmission standard and the change in numerous broadcast ownership rules. We promised to take a deeper look at these decisions when the texts of the orders were released, and here is a look at some of the interesting items in the ownership decision. We will only lightly touch on radio issues here, concentrating primarily on TV matters, as the FCC made few changes that directly affected radio, pushing most to the next Quadrennial Review of the ownership rules, likely to begin next year. We’ll post some thoughts on radio issues at some point in the future.

Certainly, there was plenty of legal discussion about the standards for reconsidering an FCC decision (this reconsideration being a review of the FCC’s ownership order adopted under the last administration in August 2016). While the FCC ultimately concluded that it could review the 2016 decision where it believed that there were substantial errors in the Commission’s initial decision, the legal wrangling over the process for the review is perhaps less interesting to most in the broadcast industry than is some of the other discussion contained in the order and what that may portend for further ownership review by this administration. So let’s look at the FCC’s discussion of the various issues that it faced in the reconsideration order. Continue Reading

A Notice of Apparent Liability released yesterday shows that the FCC is still enforcing its EEO rules even though those rules have been somewhat relaxed to reflect modern recruiting practices. As we wrote here, the FCC now allows a station to recruit to fill employment vacancies solely by using online sources. But, as we warned here, that does not mean that a station can ignore its obligations to document its EEO efforts and to otherwise observe all of the obligations set out in the EEO rules. In yesterday’s action, the FCC’s Media Bureau proposes a $20,000 fine for a license operating a 5-station cluster in South Carolina that allegedly did not keep good EEO records and, when subject to a random EEO audit, was unable to identify any recruitment sources for other than word-of-mouth recruiting for 6 of 11 hires over a two-year period. For several positions, the licensee was said to not even be able to provide information about any recruitment sources that were used by the station.

The FCC requires stations to use sources other than its existing employees to recruit to fill full-time vacant positions. Using simply word-of mouth recruiting is considered to be recruiting through the “old-boys network” that the FCC’s EEO rules are designed to overcome, so this violation alone was enough for the FCC to have concerns. But, according to the FCC’s Notice, that was not the only deficiency in the licensee’s paperwork. Continue Reading

The week before last, Bobby Baker, the head of the FCC’s Office of Political Programming and the acknowledged guru on political broadcasting issues, and I conducted a webinar for 20 state broadcast associations discussing the FCC rules regarding political advertising and related issues. We have done this seminar every other year for quite some time to help broadcasters prepare for an upcoming election year. Every time we conduct the session, we are faced with some new questions, usually not because the FCC rules have changed, but instead because new advertising practices have arisen in the industry. This year, one of the issues that prompted a question from the audience dealt with “programmatic advertising” – the question being how advertising bought through various programmatic platforms would play into the political broadcasting analysis that each station must conduct to prepare for the political season (including questions of political rates and access rights that might be affected by programmatic sales).

While most of the principles governing the FCC rules on political broadcasting are relatively established (and many are summarized in our Political Broadcasting Guide available here), new advertising practices and opportunities always raise questions as to how those established rules are to be applied. Programmatic buying of advertising time is one of those areas where these questions have arisen in recent years. In the last few years, programmatic buying has become the buzzword in broadcast advertising circles for both radio and TV. It is intended to make ad buying easier and more akin to the experience that ad buyers have when they place online advertising, allowing most of the buying process to take place from the buyer’s computer, anywhere and at any time, often without directly engaging with a station account rep. Continue Reading

The FCC’s decision to abolish the main studio rule, about which we wrote here and here, is to be effective 30 days after the publication of the decision in the Federal Register. That publication is tentatively scheduled, according to the Federal Register documents here, for tomorrow. That would make the rule change effective on January 7, 2018, although we understand that the FCC may consider it to be effective on January 8th, as the 7th is a Sunday. Obviously, things can change and the publication can be delayed, but if all goes as scheduled as it routinely does, those stations looking to eliminate their main studio can do so on or after January 8.

Note that there has been some concern that the Federal government could close if no funding extension is in place by tomorrow, and the closing of the Federal government would mean that the Federal Register would not be published. But funding is in place through tomorrow, so tomorrow’s publication should not be interrupted by any shutdown. Continue Reading

As we wrote here, a three-judge panel of the US Court of Appeals for the District of Columbia recently reached a 2-1 decision upholding the FCC’s decision to not impose obligations on broadcasters to broadcast multilingual EAS alerts. However, MMTC, the public interest group seeking the imposition of the requirements, has asked for what is called a “rehearing en banc,” asking that all the Judge of the Court review the decision of the original panel. The request for the review relies heavily on the opinion of the dissenting judge from the initial panel, who argued that the FCC has twice promised to look at ways to implement multilingual EAS alerts in some form or another, and twice been unable to gather enough information to be able to come to any decision. As the FCC’s most recent decision was based on a premise that it would again seek to gather such information, the dissenting judge asked why the FCC should be trusted to come to a decision now, when it had not been able to do so before.

The full court has called for responsive briefs, where presumably the difficulties in implementing such alerts will be discussed (see our article here). But broadcasters should be watching this request for review, as it raises serious issues that may be considered by the court.

Late yesterday, the FCC released the Public Notice setting out the instructions for the final window for AM stations to get exclusive access to FM translator stations. This window, to be open in late January, is primarily for Class A and B AM stations that were not permitted to file in this summer’s window when Class C and D AM stations could file for new FM translators. But any AM licensee who did not file in this summer’s window, and who also did not acquire a translator last year during the period when AM licensees could acquire existing FM translators and move them up to 250 miles to rebroadcast their AM station, can also participate.

The final window will be open from January 25 through January 31. As in this summer’s window, mutually exclusive applications filed during that window will be resolved by an auction if they cannot be resolved by settlements or engineering solutions. Resolving mutually exclusive applications can be done only by filing settlements or technical amendments that comply with the minor change rules – meaning that the amendments can only amend to different sites on the same channel, or on channels three up and three down from that initially specified, or a channel precluded from use by the initially proposed channel because of Intermediate Frequency interference. Applicants cannot amend to any vacant channel that may be available in their area. In this summer’s window, most applicants were able to avoid mutual exclusivity with other applicants – but not all (as witnessed by the mutually exclusive groups that had until last week to settle their differences through dismissals for no more than out-of-pocket expenses or by engineering amendments – see our article here). Continue Reading

Yesterday brought news that a Federal Magistrate issued a ruling (a 42 page order discussing fine points of law) deciding that the antitrust lawsuit brought by RMLC against GMR should not be tried in the Pennsylvania court where the suit was brought. As we wrote here, RMLC (the group that represents many commercial radio operators in music licensing matters) had argued that GMR (a relatively new organization representing songwriters in licensing music use as do ASCAP, BMI and SESAC) was acting in violation of the antitrust rules by trying to license music from a number of songwriters at prices well in excess of the amount that corresponded to these artists’ share of radio airplay. GMR seemingly retaliated by suing RMLC in a Los Angeles court, arguing that RMLC itself violates the antitrust laws by functioning as a buyer’s cartel unifying music licensing buyers against these songwriters (see our article here). Since these dueling suits were filed, the parties have been fighting over where this case should be heard.

RMLC had brought their case in Pennsylvania both because a number of RMLC members operate in Pennsylvania and because RMLC had obtained a favorable result in that court in similar litigation against SESAC, leading to the arbitration process that substantially decreased the rates that the commercial radio industry pays to that organization (see our article here). GMR sued in California as it is headquartered there, and presumably thought that it might get a bit of a “home court advantage” by trying a case in a state a bit more disposed toward content creators. So what does the decision yesterday mean? Continue Reading

For many years, the FCC’s Audio Division has allowed the rebroadcast of FM multicast HD signals on FM translators. Recognizing that HD receivers are still not widely available, the analog FM translator makes these digital subchannels widely available. See our post here from 2010 about a case where the FCC approved such rebroadcasts. Yesterday, the Audio Division released another decision dismissing objections against an FM translator license application, where the petitioner argued that the translator licensee, using two translators at the same location to rebroadcast different HD channels, was violating the FCC rule that prohibits two translators serving substantially the same area from rebroadcasting the same programming. The decision concluded that the rule prohibited the rebroadcast of the same “signal” or “programming” in the same area on two different translators, but permitted translators that rebroadcast different HD channels of the same station, as long as those channels had different programming.

So the common practice of rebroadcasting HD signals on FM translators has been blessed once again – at least for now. In the decision, the following statement was made:

the Commission has not yet adopted specific rules governing the technical details of rebroadcasting digital subchannels over FM translators. In 2007, the Commission stated that a fuller record was needed before promulgating specific rules regarding “use of FM translators and boosters to rebroadcast multiplexed audio streams.” Pending further Commission action on this matter, we rely on existing rules and precedent to dispose of the subject Applications and Petitions

This implies that the Commission could, at some point, change its current practice and adopt limits on the use of translators to rebroadcast HD subchannels. We have no reason to believe that any change in policy is imminent, but thought that we should pass along this warning that the rules on this practice have never been set in stone so anyone contemplating such operations needs to carefully weigh any risks.

While the end of the year is just about upon us, that does not mean that broadcasters can ignore the regulatory world and celebrate the holidays all through December. In fact, this will be a busy regulatory month, as witnessed by the list of issues that we wrote about yesterday to be considered at the FCC meeting on December 14. But, in addition to those issues, there are plenty of other deadlines to keep any broadcaster busy.

December 1 is the due date for all sorts of EEO obligations. By that date, Commercial and Noncommercial Full-Power and Class A Television Stations and AM and FM Radio Stations in Alabama, Colorado, Connecticut, Georgia, Maine, Massachusetts, Minnesota, Montana, New Hampshire, North Dakota, Rhode Island, South Dakota, and Vermont that are part of an Employment Unit with 5 or more full-time employees need to place their Annual EEO Public File Reports into the public file (their online public file for TV stations and large-market radio and for those other radio stations that have already converted to the online public file). In addition, EEO Mid-Term Reports on FCC Form 397 are due to be filed at the FCC on December 1 by Radio Station Employment Units with 11 or more full-time employees in Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont; and Television Employment Units with five or more full-time employees in Colorado, Minnesota, Montana, North Dakota, and South Dakota. We wrote more about the Mid-Term EEO Report here. Continue Reading

The Copyright Royalty Board yesterday announced in the Federal Register, here, that the sound recording royalty rates paid to SoundExchange will be increasing next year. In December 2015, when the CRB set the current royalty rates that apply from January 1, 2016 through December 31, 2020 (see our articles here and here), the CRB noted that the rates would increase based on increases in the Consumer Price Index. Last year, the Board determined that the CPI had not increased enough to merit an increase in the royalties. This year, based on the calculations set out in the Federal Register, there will in fact be an increase.

So, for all streaming in 2018, nonsubscription webcasters will pay a per performance royalty of $.0018 instead of this year’s $.0017. For subscription streams, the rate will increase to $.0023, an increase from $.0022 per performance rate. These rates apply to all noninteractive webcasters who pay the statutory royalty (see our article here for an explanation of the difference between noninteractive and interactive webcasters). Thus, the rate increase will include simulcasts of broadcasters’ over-the-air programming. Noncommercial webcasters who exceed 159,140 aggregate monthly tuning hours (for which they pay $500 per year) will also pay at the $.0018 rate for performances above the tuning hour limit.

Note that these rates apply through the end of 2020. As the CRB proceedings take two years to arrive at new rates, the Board will be starting a new proceeding to determine royalty rates for 2021 through the end of 2025 starting in January 2019. It’s never too early to start thinking about the next proceeding now.

About David Oxenford

David Oxenford represents broadcasting and digital media companies in connection with
regulatory, transactional and intellectual property issues. He has represented broadcasters before the Federal Communications Commission, the courts and other government agencies for over 30 years. Continue Reading

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About

David is a partner at the law firm of Wilkinson Barker Knauer LLP, practicing out of its Washington, DC office. He has represented broadcasters for over 30 years on a wide array of matters from the negotiation and structuring of station purchase and sale agreements to regulatory matters. His regulatory expertise includes all areas of broadcast law including the FCC’s multiple ownership limitations, the political broadcasting rules, EEO policy, advertising issues, and other programming matters and FCC technical rules.